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CHRISTINE ROMANS, CNN HOST: Most American say things are going badly in the country today. So, what's the problem, and which party do they trust to fix it?

Welcome to YOUR MONEY. I'm Christine Romans. Ali Velshi will be by in a bit.

Candy Crowley is CNN's chief political correspondent and the host of "STATE OF THE UNION." Candy, Americans say the number one problem facing the country is the economy, and we just saw Rahm Emanuel join a growing list of White House departures. Maybe Treasury Secretary Tim Geithner survives. If the Democrats lose big in midterm elections, it's driven by the economy.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, sure he can survive. I think these - these departures that you have seen so far, particularly in the economic realm, have been people that said early on I'm only going to stay a year or a year and a half. So I'm not sure I would necessarily look at that and say, oh, the president's about to change his positions.

But I do think that the Larry Summers vacancy is key. I think a lot of people are watching that to see what the president, if he's pointing in any particular direction, if there is any change-up in the way he's going, I think will be in that Larry Summers job as the top economic adviser.

ROMANS: And what will the signal be that it send about economic policy and strategy for this country?

Next, Mark Preston is CNN's senior political editor.

Mark, you know, take a look at these polls. When you ask which party is more responsible for the economic problems, 41 percent say Congressional Republicans as opposed to 35 percent blaming Congressional Democrats. But, at the same time, ask which party is more likely to improve the economy, and 47 favor the Republicans in Congress versus 41 percent choosing Democrats.

So, Mark, voters blame the Republicans for the economy, but heading into the midterm, it looks like they're also counting on Republicans to fix it as well?

MARK PRESTON, CNN SENIOR POLITICAL EDITOR: Well, you know Christine, these are voters who are looking back at the past eight years of the Bush presidency and they realize that's when the economic slide really began to show and that's when they began to feel it.

But, you know, historically, Republicans have always done better on economic issues and on tax cuts and the Democrats are considered the party of tax and spend. And, let's face it, right now Democrats control Congress, Democrats control the White House and we still seem to be in this economic mess.

So when you're looking for solutions, you know, they might blame Republicans, but they think Republicans can get them out of the mess.

Jim, President Obama's signed a bill designed to give small business $42 billion in aid. The president tweeted about this - yes, the first president to tweet - "Small Business Jobs Act will cut taxes and make more loans available for small business. It's a great victory for America's entrepreneurs."

Jim, the president has some fences to mend with the business community. What did he buy for $42 billion?

JIM ELLIS, ASSISTANT MANAGING EDITOR, BLOOMBERG NEWSWEEK: Well, he bought a lot of political goodwill. I mean, it's almost gospel that small business is the sort of engine of growth, especially job growth, and jobs have been a really big problem for the economy.

The problem, you know, from an economist's standpoint, however, is that it's a little more complicated than that. The data is actually very contradictory. If you look at the Census data, it says 75 percent of new jobs come from the smallest businesses. But look at the BLS, the Bureau of Labor and Statistics data, it says that 24 percent of jobs come from there. So it's probably not - it's probably overblown.

But, small business guys tend to be very big in their communities. They tend to also vote and they tend to influence the votes of others. And so, therefore, people want to make them happy.

ROMANS: I'll be honest with you, Jim, a lot of them are telling me, look, I need customers. I need - I'd love to write off a new piece of equipment, but I'm not going to buy a new piece of equipment if I don't have the customers to go with it. I mean -

ELLIS: I mean that is the -

ROMANS: And that's the bottom line.

ELLIS: That's the biggest thing that they need right now is demand. If you look at the latest surveys from the National Federation of Independent Business, it's always been taxes are too high. It's always been the number one problem for small business. It shifted two months ago to demand is the problem. We can't get enough customers to come in.

That probably is what the economy needs more than sort of targeted tax cuts, but tax cuts, especially when the Republicans want to make headway in both Houses, is what we're going to get.

ROMANS: Well, certainly a $30 billion fund in there to - you know, to give some lending to community banks and the likes, trying to get money flowing again is something that can - that can possibly help. It's certainly a lot of money.

Candy, you know, come back in time with me about - let's say 30 years. The economy was in big trouble. In 1980, Republican Ronald Reagan elected on a wave of optimism. Two years later, unemployment rate, 10.8 percent. The results of the following midterm election, Democrats pick up 27 seats in the House, losing just one in the Senate.

Fast forward to 2008, President Obama says, yes, we can. We can fix the economy. But, two years later, the unemployment rate has jumped from 6.9 percent when Obama was elected to 9.6 percent today.

So, Candy, is there a parallel to Reagan's first midterm, and is it a fair one?

CROWLEY: I don't know if there's a parallel, but I think there are some lessons in there that everyone might look at. And, first and foremost, the whole notion that the president is in huge trouble, and certainly, right now, in the snapshot polls, that's absolutely correct as his approval number has dipped into the low 40s.

But what - as well, did Ronald Reagan's end Bill Clinton's at this point. And what happened? They all got re-elected.

So this is not about the president and where he's going politically. This is about these midterm elections. And I think the lesson you can take is what has happened in any number of midterm elections when - particularly when the president is not popular, is they're going to lose seats. The question is, is this a huge, big loss or is this a sustainable loss?

ROMANS: And Mark, I wonder if - the question is also if voters take it out in the voting booth this - this November, if they're a little more patient coming in to 2012.

PRESTON: Well, you know, the very - the unanswerable question at that point, certainly at the White House they're very much concerned about the results of what happens in the midterm elections. In fact, we had Congressional Democrats that were just down there this week that had a private meeting with the president and they said we need you out on the campaign trail.

Now, President Obama will play very well in some districts, and in other districts he wouldn't play well. But where he did really well was in Wisconsin just a few days ago, where he held this campaign style rally. You can say what you want about President Obama, does his policies work, does his policies not work, but he's very good on the campaign trail.

ROMANS: Jim, do you see the president taking a new direction with his economic message, maybe with - by announcing who's going to succeed Larry Summers, or by any other decisions he has to make in terms of who is stocking the White House and his advisory councils with?

ELLIS: I think that he's going to have to sort of have a - people in the White House economic circle now who are going to spend a lot more time worrying about the middle class. I think that, you know, politically it's hurt him to have seemed to have his eyes elsewhere.

I also think that a lot of people in the business community are so worried about demand right now. Demand is what's really going to get the economy back on - on track, that they want to find ways to get middle class, you know, people spending again.

Middle class matters because there's a lot of them. We've seen a lot of debate lately about helping people with, you know, $250,000 or more in income. That's an important part of the economy simply because they have a lot of extra capital to pump in the markets. But, at the same time, you need a lot of people, you need a lot of numbers to actually get general economic activity moving. And, for that, you really do want to concentrate on the middle.

Candy and Jim, stick around. Mark, you're going to take your leave, but thank you so much for a - for a great commentary. Thanks, guys.

The - the rich are getting richer, the poor and middle class slipping. So are tax cuts for everybody a good idea?

We have one of the key architects of the original Bush tax cuts here. We're going to ask him whether tax cuts for all of you should be extended, next.

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ROMANS: Let's take a look now at the growing income gap in America. The top earning 20 percent take home over half of the income generated in this country. That was in the year 2009, a year, don't forget, that the recession officially ended. The bottom earning 20 percent take home just 3.4 percent of income generated. That is a widening gap.

Glenn Hubbard joins us now. He's - he's dean of Columbia University Graduate School of Business. He's the author of a fascinating new book called "Seeds of Destruction: Why the Path of Economic Ruin Runs Through Washington, and How to Reclaim American Prosperity." And he was chairman of the Council of Economic Advisers to President George W. Bush, helped design the Bush tax cuts.

Thanks for joining us.

You know, there's major political debate at the moment about extending those tax cuts for the wealthy and average Americans. Glenn, looking at that income gap, does it take away some of the argument for extending the tax cuts for the rich?

GLENN HUBBARD, DEAN, COLUMBIA UNIVERSITY GRADUATE SCHOOL OF BUSINESS: Well, I think there're really two points about extension. We should certainly extend the entire current tax code until we're ready to have a serious conversation about the size of government, and that's the second and bigger discussion.

If in 2012 we decide we want a government as large as that's in President Obama's budget, we can't afford the current tax system. The Bush tax cuts would all have to go. We need other tax increases. If we want a smaller government, it's a different story.

That's the real question - how big do we want government to be, not the Bush tax cuts.

ROMANS: So - so should we extend the Bush tax cuts with an expiration date? Should - should they all be extended?

HUBBARD: I think we should extend them until we're ready to have that conversation, and to me that's the 2012 presidential campaign. If the American people say, yes, we would like a government of 25 percent of GDP, which is an offer from the current administration, we have to repeal all of the Bush tax cuts, not just the ones for high income taxpayers. In fact, we need a whole new tax system, another discussion we should probably have.

ROMANS: Oh, and that's easy politically. They have - we can do that, right?

HUBBARD: Well then, we have to.

Unfortunately, this is not just economics, it's about math. We can't keep saying we want a government that's five percentage points of GDP higher than our present tax system could possibly even raise. One of those has to give.

And that's why, say, in the election, the American people need to speak. If - if we all collectively want a big government, we need to start talking honestly about how to pay for it.

ROMANS: OK. So talking about how to pay for it. I mean, we - we have to pay for things - the life we've already led still has to be paid for, essentially. So, politics aside, whether it's this year, down the road, or 2012, how do we deal with debt in a serious way without raising taxes?

HUBBARD: Well, I think the first step is to pick one of our big, long-term problems. As I argue in the book, "Seeds of Destruction," the entitlement problems are our largest fiscal problems.

Social security is the easiest one to make progress, and I think we can say to ourselves, we have a big, unfunded liability there. The burden of that should not be borne by lower income Americans. It should be borne by higher income Americans. And the way to fix that is to slow down benefit growth for higher income Americans.

If we did that, we would give ourselves a lot of fiscal room to move in the short run and the long run. I think there's a tendency in Washington to say let's fix everything all at once. We can start simply with social security and make big progress.

ROMANS: All right. Stick with us, because I want to bring back in Candy Crowley and Jim Ellis.

Candy, you know, listen to President Obama this week criticizing Republicans' efforts to extend the Bush tax cuts for the wealthy.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: They want to borrow $700 billion to provide tax cuts for the top two percent of Americans, people making more than $250,000 a year. It would mean an average of $100,000 check to millionaires and billionaires. That's $700 billion we don't have.

(END VIDEO CLIP)

ROMANS: Candy, can Democrats score political points by turning the potential extension of those tax cuts into some kind of a class warfare debate?

CROWLEY: I don't - class warfare is something that comes up a lot in elections, particularly in presidential elections. I've never seen it actually take hold as something completely powerful, and I think part of the reason is that a lot of people aspire to make $250,000 or over every year that they don't see it as punitive.

I think the deficit question is probably a more powerful argument except that economists will tell you that the middle class tax cuts cost too much, too. So it - it does seem to sort of - it - the deficit, as I say, is an easier one, and it's hard for the Republicans to defend in as - politically, at least, your - your guest excepted.

But just on a purely political look at it, it is extremely difficult to support tax cuts for the rich while you're yelling about the deficit. And that's where I think the Democrats have made some inroads, not on the populist thing.

ROMANS: Now Glenn, in your book, you're - you're pretty clear that you think that this president is taking us down the wrong path. And, in fact, I want to read one section on page five that really caught my attention. "You see America is close to a destructive tipping point. We must change how we conduct our politics and economics and thereby rebuild and rebalance our economy, or we will inevitably go the way of all once great nations and suffer an irreversible decline."

You're talking about some very scary long-term stuff in a town that thinks in very short terms of two and four years, for example.

HUBBARD: Well, that's right, but it's still important. And it's not just about President Obama. Many of these fiscal mistakes were made by the Republican Party as well. It's not one or the other. It's as a nation, we have to decide what to do.

The issue isn't about really extending Bush tax cuts. The issue is about what kind of tax system is best for growth in our country. What can we do to bring down spending?

I agree the Republican Party also needs to be more forthcoming about where spending cuts could come from. I gave you an example with Social Security. It would be interesting very to hear those.

If we really want President Obama's government, then, yes, we are at that destructive tipping point.

ROMANS: And, you know, Jim, let me talk about more tax breaks. $12 million in tax breaks for small business is part of that $42 billion small business jobs that actually we were telling you about, extending the Bush tax cuts for the wealthy, supposed to, in theory, hire - is for hiring.

But, Jim, are business owners already getting their - their tax breaks? And how do we pay for that?

ELLIS: Well, actually there are a lot of tax breaks in the bill. And so therefore, for the vast majority of businesses, they - they're all being taken care of.

When you really look at the numbers, only about the - for extending the Bush tax cuts for the wealthy, only about three percent of businesses that are looked at by the Congressional Research Bureau would actually be affected by that. And small business will be affected by that.

So in a way, it's a very tiny percentage. But that tiny percentages are the most dynamic small businesses and that's the rub. The small businesses that have the potential to become large businesses are the ones that will be affected there. But most likely, they're not making their decisions based solely on tax policy.

ROMANS: All right. Jim Ellis, Assistant Managing Editor for Bloomberg Business Week, thanks so much. Also, Candy Crowley, our Chief Political Correspondent and Glen Hubbard, whose new book "Seeds of Destruction: Why the Path to Economic Ruin Runs through Washington and How to Reclaim American Prosperity."

Thanks, everybody.

If you could name your own price, would you pay as little as possible or pay with something is worth? The guys from Freakonomics want to know exactly that. The results are next.

(COMMERCIAL BREAK)

ALI VELSHI, CNN HOST: Along with economist Steven Levitt, "New York Times" journalist Stephen Dubner authored - co-authored a book back in 2005, if you haven't read it, "Freakonomics." It's a best-selling book which basically argues that at the root of economics is the study of incentives and how to get people to do things that you want them to do by providing those incentives.

Well, the movie - the book has now become a movie, which is hitting the big screens now. And I'm joined by Stephen Dubner from the "New York Times" to talk a little about it.

Stephen, welcome. Thanks for joining us.

STEPHEN DUBNER, WRITER, FREAKONOMICS: Hi, Ali. Good to see you.

VELSHI: When you look at - at the examples you've got. I mean, is the conclusion in the book and the movie that - that all of behavior is a series of incentives. In other words, if you give somebody some good reason to make one choice over - over another, you can predict how they'll behave.

DUBNER: That is very true, but let me have the big - let me include the big caveat here. What most economist - particularly behavioral economists and a lot of researchers try to do is run experiments, to figure out the way people will respond in a new situation. Because it's a new situation, you don't know yet. Then they try to take those findings and extrapolate them and, say, OK, here's what's going to happen. If you introduce a new tax hike or a new tax cut, here is the behavior we're going to see.

Here is the problem with that. Lab experiments and research experiments on a small scale don't usually scale up very well. And the reason why is that people respond to incentives in ways that are usually, that are often very, very hard to predict.

So the best and brightest people in government and policy, wherever they are, in education, can work as hard as they can with all the right intentions to come up with just the right incentive scheme.

VELSHI: Right.

DUBNER: But then you set it loose in the real world where there's an army of people looking out for their self-interest and they begin -

VELSHI: Right.

DUBNER: -- to gain the system. So I can tell you story after story of unintended consequences where government action -

VELSHI: Right.

DUBNER: -- that sound great on paper backfire at least to some small degree. So it's important -

VELSHI: And that's the important - that's the important thing about this book. And the other thing is that many of the incentives that you write about in the book and that we'll see in the movie are not actually about money. There are other - other forms of incentives.

Let me ask you one thing, though. In the previews, there was a pay for - pay what you want pricing scheme, anywhere from a penny to $100. In exchange you asked the ticket holders answer several questions. I suppose you wanted to do what you do, keep on studying this.

How did that work out as an economic study tool? And did anybody actually pay $100 to see the previews? DUBNER: So, honestly, the findings are pretty hilarious. We're in the midst of writing them up for reel (ph). I'll share a couple of things with you right now.

So they were - in the early pay what you wish survey, as you said, there are about five - I looked at the data when there were about 5,000 respondents. Of the 5,000, I believe there were nine people who actually volunteered or offered to pay $100. The prices went from one penny to $100.

So I'm saying who on earth wants to do that? And that's maybe my theory, which is a weak theory, is that maybe each of those people thought that they would be the only person -

VELSHI: Right.

DUBNER: -- to show up in the data as the guy who paid $100 and they get some notoriety for that. Unfortunately, they were just out of $100.

On the other hand - and let me ask you, Ali. I'll give you a quiz. What percentage of all respondents do you think paid one penny, the lowest possible amount?

VELSHI: Well, I would say very little, and I know that from free museums and I know it from Panera bread that tried this example. Very few people pay the minimum asked.

DUBNER: All right. Here's why policy is really hard.

VELSHI: Yes.

DUBNER: Those are great examples. You just gave the Panera one.

VELSHI: Yes.

DUBNER: But the circumstances are different. Panera was the thing that I believe was going to charity.

VELSHI: Yes.

DUBNER: And I believe it was an in person thing. This was an internet survey. So I'll tell you, 34 percent of all people -

VELSHI: Huh.

DUBNER: -- paid one cent.

VELSHI: Wow. Much - I would have thought it was in the low single digits.

DUBNER: I would have, too. So I'll tell you, as an experiment to us, these data are very valuable.

VELSHI: Right. Right.

DUBNER: And in terms of the box office money that came in for the distributors and producers -

VELSHI: Yes.

DUBNER: -- it was not a valuable experiment.

VELSHI: But you make your point about incentives. Very interesting.

Stephen, good to see you. Thanks so much. Stephen Dubner, co-author of "Freakonomics."

Hey, listen. The gulf oil spill is capped. But one man says BP could trigger the next financial crisis. Find out why when we come back.

(COMMERCIAL BREAK)

ROMANS: The well in the Gulf of Mexico may be capped, but as the cleanup continues BP could find itself in a whole new mess, one that our next guest says could trigger the next financial meltdown.

Matt Taibbi is the Contributing Editor at "Rolling Stone". Matt, you wrote that the billions of dollars of debt in (ph) place and whether or not BP can pay back its debt. How does that work? And how could it really wreak havoc on the global financial system? You make a pretty scary - scary analysis in this piece.

MATT TAIBBI, CONTRIBUTING EDITOR, ROLLING STONE: Just to point out at - at the very top. This is an extreme long shot that there would - that there would be an AIG style catastrophe.

But the problem with this sort of unregulated derivative economy is that you have a situation where companies can bet on the debt of other companies or mortgages or anything like that. And if there's a credit event, if there's a bankruptcy or a restructuring, suddenly all those bets kick in and you have to pay off.

And what happened with, for instance, AIG is, you know, when there was - I'm sorry, the Lehman Brothers -

ROMANS: Right.

TAIBBI: -- when there's a bankruptcy, suddenly a lot of these - these derivative-based bets will fail and you'll have all sorts of money- changing hands. And it's complete chaos because nobody knows exactly who owes who in this situation.

ROMANS: You make a good - you used a good example. I think people can understand about these unregulated derivatives market that you talk about. You say it's like a Foot Locker putting a pair of Nike's in front of a three-way mirror and then selling off the reflection.

TAIBBI: Right. Right. And basically it's synthetic lending. And if you don't have an asset that you can actually sell, what you'll do instead is you - you sell the bets on the asset and that's basically all the credit default swaps are. It's two - two parties engaging in a deal to bet on whether or not a third party is going to pay off his - his debt. And then you can take that bet and package it and sell it as an asset, only - you know, that pays income like a bond or mortgage.

ROMANS: I will tell you, though, treasury secretary of a very powerful country once told me that the first thing what treasury secretaries do when they wake up in the morning is they check the credit default swaps of their own country -

TAIBBI: Right.

ROMANS: -- and how they're trading, and also big companies. And that's the first thing that CEOs do, too.

This is kind of a more than a stock price how people judge what the market thinks of the health of their company or country, in many cases, because they - you know, debt that traded of those. But the credit default - default swaps, it's been cheaper and cheaper to ensure the debt of BP since -

TAIBBI: Close to the pre-leak levels. I mean, before the -- any of -- you know, any of the scandal happened, BP was trading at, you know, 40 or 50 in its credit default swaps, which is really equivalent almost to U.S. Treasuries. It was considered...

ROMANS: And that means -- and that means paying -- you paid $40,000 to place a bet on $10 million in their debt.

TAIBBI: Right. Yes. Exactly. And you know, BP, like AIG before the AIG scandal, was just considered a rock solid safe bet. You know, when you were buying a CDS on BP, it was about as safe as you could get. After the oil spill, the prices went through the roof and...

ROMANS: Like, $600,000 to insure that same $10 million in debt.

TAIBBI: Right. And there was even a point where end-day trading (INAUDIBLE) the close of the high, was about 600. But there were points where the price went up to about 800 or 900 during -- during some of those days.

ROMANS: But now it's back down -- we just checked. Now it's down to, I think, 160.

TAIBBI: Yes, 160...

ROMANS: Right.

TAIBBI: ... which is relatively low, but it's still -- it's still higher than it had been before. ROMANS: Let me bring in BP because we wanted to get BP's response because, you know, I mean, it's a pretty -- it's a pretty compelling argument that you make, that this could -- long shot as it may be, that this -- that BP could have trouble on its hands or the financial system could if BP were to (INAUDIBLE) BP launched a bond in the market which was heavily over-subscribed, the company told us, raising $3.5 billion within a day. "And our credit default swap rating improved as a result. The shares appear to be responding to the market's positive reaction to our bond issue."

They're saying they need to issue -- they need to raise money. They need to -- you know, in the debt markets, everything is working fine.

Let's bring in now Richard Quest, host of CNN's "QUEST MEANS BUSINESS." One thing we do know about BP is that this company is a cash machine. Yes, it has huge costs and uncertainty ahead of it. And you know -- that's one thing to be clear. I mean, this is a company that's making money hand over fist.

But Richard, the survival and prosperity of BP -- this is a vital British interest, as well, isn't it.

RICHARD QUEST, HOST, "QUEST MEANS BUSINESS": Oh, no, hang on a second here. Come on. Take off your nationalistic flag for a moment there, Christine. Yes, it is of importance to the U.K. economy. It's a major company. It's the largest on the market in the U.K., or one of the largest. But before you start throwing a rock across the Atlantic, 50 percent of BP shareholders are in the United States.

ROMANS: Right.

QUEST: A vast proportion of its revenue comes from the United States. The pension funds that have invested in the PRN (ph), the United States. So I think that, you know, before we (INAUDIBLE) too far down that particular road, we need to just point out that BP has this international aura about it, which is exactly why there was such fury and fume when people in the administration insisted on calling it British Petroleum, which it hasn't been for many years.

On this very interesting point of the bonds and the CDSs, you're right, BP did get $3.5 billion in bonds away just this very week. But the insuring of CDSs or the CDS market was exactly -- that synthetic CDS market was exactly what was behind the Goldman Sachs Abacus (ph) Paulson (ph) debacle earlier this year.

TAIBBI: Right.

QUEST: And the insuring of -- and the insuring -- it's right. And finally, that is why the European community is looking at legislation and regulation that would prevent you from insuring an asset that you don't have an interest in -- the old line, of course, insuring your neighbor's house and then watching it set on fire.

ROMANS: I'm wondering, Matt, if the financial regulatory reform that we have, which already is supposed to bring some derivatives to light -- does that bring of this to light, more transparency? TAIBBI: No. There was an attempt by one of the senators -- and I'm sorry, it's escaping me which one -- to institute a ban on what he's talking -- what Richard's talking about there, naked CDS, which is, again...

ROMANS: This is a family program, gentlemen!

(LAUGHTER)

TAIBBI: But it's exactly what he's talking about. It's when two people place a bet on debt that they have no personal relation to. And it has no social purpose, this kind of betting.

QUEST: None. None.

TAIBBI: It's purely gambling.

QUEST: None!

TAIBBI: It's just casino gambling.

QUEST: Absolutely. Absolutely.

TAIBBI: And there's no reason why it should be allowed, but we do allow it.

QUEST: Absolutely!

ROMANS: All right, gentlemen...

QUEST: Absolutely!

ROMANS: ... thank you so much. Richard Quest...

QUEST: Absolutely!

ROMANS: Thank you so much, Richard Quest. I'm not throwing any stones across the Atlantic. I love you over there! Please! Please! We have this special relationship. Also Matt Taibbi, "Rolling Stone," another great piece, interesting piece. Thanks so much.

TAIBBI: Thank you.

ROMANS: For better of worse, but with certain conditions. Why more and more women say "I do" to prenups. That's next.

(COMMERCIAL BREAK)

ROMANS: We are back with Richard Quest from London, and comedian Hal Sparks joins us now from Los Angeles. Welcome to the program, Hal.

HAL SPARKS, COMEDIAN: Thank you.

ROMANS: All right, let's get right to it, gentlemen. The number of couples seeking prenuptial agreements is on the rise. An astounding 73 percent of divorce attorneys have seen an increase in the number of prenups. This is according to a recent study by American Academy of Matrimonial Lawyers. And it's not just wealthy men trying to protect themselves anymore, 52 percent of lawyers surveyed say they have seen a rise in the number of prenup agreements initiated by women. Is the recession to blame, a lack of trust, people just getting smarter about the future of their money?

Hal, Wow! Women saying "I do" with an asterisk.

SPARKS: I think the biggest reason is this is natural arc of women finally gaining in the economic world. If you look at acts like the Lily Ledbetter Act being signed and equality and pay starting to become more of an issue, women have more to protect, and rightly so. And you've got guys like me out there that have no problem marrying up. So clearly, it's smart.

(LAUGHTER)

ROMANS: You know, Richard, it's interesting because the group told me that, frankly, women are asking more and more for protection on their pensions, their 401(k)s, assets down the road. People are also asking for more protection in terms of health benefits, make sure they're still going to covered in the event of a divorce. They're thinking about long-term financial security more than ever before, not just cash (INAUDIBLE)

QUEST: Yes. Absolutely. And for one very, very good reason. More women were swindled and diddled out of pension rights at the time of divorce than just about anything else because what they want to do is, for understandable or whatever reasons, get out of the relationship. So many people signed out long-term benefits that, frankly -- look, you know, if I say to you, You might need this in 25 years' time, you'd say, Oh, I'll worry about that then.

Here in England, prenups are -- they -- the courts haven't quite accepted them as being totally and utterly legally binding, which is why in many cases, England is now becoming a preferred area for divorce, where people want to ratchet as much money as they possibly can!

ROMANS: All right, gentlemen, stick with me because we talked about prenups, but you know, there's one way to make sure you don't lose money in divorce, you don't want to get married in the first place, right? Is money really the real reason so many young people are choosing not to get married these days? We're going to have that in a moment.

But first, this is my first chance to really thank Hal for this summer.

SPARKS: Yes?

ROMANS: While I was juggling three little babies on maternity leave and you were on some fancy, exotic, wonderful comedy tour, exchanging e-mails in the dead of night because you wrote the foreword to my new book -- and I wanted to thank you so much for that. It was very well done and I'm just thrilled that you took the time to do it. SPARKS: Oh, no. Thank you. It was my distinct honor. You know, as long as I've been coming on the show, I always -- no deference to Ali or Richard, but I always hope that you're on but I love hearing you talk and I love...

ROMANS: Oh!

SPARKS: ... your angle on things and I appreciate it greatly. And I think -- I just hope that the book sells really well and that you have a prenup.

ROMANS: Oh, exactly.

SPARKS: I'm kidding. You don't need one. I'm just (INAUDIBLE)

ROMANS: Well, I love the idea of me literally with peanut butter in my hair finishing this book, and you on this glamorous comedy circuit. It was quite...

SPARKS: I -- well...

ROMANS: ... the contrast in characters, that's for sure! But I want to...

SPARKS: There's been some glamour. I was in England with Richard, you know, in Richard's country a couple of times this year. But I was also in -- you know, in Lexington, Kentucky, and Toledo, Ohio. So let's not get too excited.

(LAUGHTER)

ROMANS: Well, in the book, I spent a great deal of time talking about the important tips that families need to take to be financially secure once again. And I want to be clear. There has never been a more urgent time to teach your kids about money. So who better to ask about...

SPARKS: "Smart Is the New Rich."

ROMANS: Yes, who better to raise -- asking about raising money smart kids than two economists who also happen to be parents. Take a look.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: I'm saving up for another bike to spray paint again.

YANA RODGERS, ECONOMIST: Another bike. How much does it cost?

ROMANS (voice-over): Asking mom and dad for money takes on a whole new meaning when mom and dad are renowned economists. Meet the Rodgerses, Bill and Yana, Ellie, Billy and Charlie.

(on camera): How do you guys teach your kids about money, when money, the economy is what you do for a living?

YANA RODGERS: For a long time now, we've been using sort of a trick, and that's the children's literature.

ROMANS (voice-over): Bill, a former Labor Department economist, Yana is a Rutgers professor who runs Econkids.rutgers.edu, a project that uses kids' books to teach economics.

(on camera): Give me an example of a book that I might have in my book shelf that actually has a subversive economic message in it.

(LAUGHTER)

YANA RODGERS: Oh. Berenstein Bears. Everybody has Berenstein Bears. There's curious George, a few of those, where he goes to a factory. Well, that's all about production. And then there's "Click Clack Moo (ph)," cows that type. That's one that Bill likes a lot, too.

ROMANS (voice-over): The cows, in case you forgot, go on strike.

(on camera): Sorry. We're closed. No milk today.

(CROSSTALK)

ROMANS: This the labor economist labor book here.

BILL RODGERS, ECONOMIST: That's right. That's right.

ROMANS (voice-over): Well, there's a Rodgers allowance system that's a little more elaborate than most.

ELLIE RODGERS, HIGH SCHOOL STUDENT: It's $2 a week. We get paid every Wednesday. And depending on chores I do, I get paid $8 an hour.

(on camera): What is it like to be raised by two economists? They know everything about money and policy.

ELLIE RODGERS: It can be a little frustrating sometimes, when I'll I want something for Christmas and -- but it'll be a little too expensive and then I'll usually have to go for maybe the bargain brand or just still on sale. I've become a very good sales shopper.

ROMANS (voice-over): It's a family created by economics. Bill and Yana met in the econ department at Harvard, and a family run by economics, like all families.

BILL RODGERS: The one thing that I -- that we -- I talk about with (INAUDIBLE) our kids is the budget constraint.

ROMANS: Right.

BILL RODGERS: You know, that is the notion of there's only a fixed amount of money, and you have to figure out how you're going to allocate that money across, you know, a more expensive baseball bat versus your cleats that your going to buy.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

ROMANS: The world's largest airline was created this week when Continental and United Airlines officially joined forces. Richard, you got a chance to speak with Jeff Smisek, the new CEO, about how the merger would affect hubs and jobs here in the U.S.

YANA RODGERS: Yes. Jeff Smisek is probably one of the most interesting, dedicated and thoroughly professional chief execs in the world. And now he has the job of running Continental and United, or the new United. I asked him, of course, particularly bearing in mind, bringing these two large airlines together in the United States, when you look at the nine hubs they've got and the tens of thousands of employees, where would there be growth and where might the axe fall.

(BEGIN VIDEOTAPE)

JEFF SMISEK, CEO, UNITED AIRLINES: I don't think there will be an axe, Richard. We have very complimentary networks. As a result, there's very little overlap and very little affect on our frontline employees. What we're going to be doing is allocating the aircraft across a much broader route network. We've got 10 hubs worldwide. I And expect to see growth, certainly from an international perspective, because we are global carrier and we'll be the world's leading global carrier. I think you're going to see new destinations and increased frequency for business travelers.

(END VIDEOTAPE)

ROMANS: All right, so Richard, but what about the flying experience? Both of you guys are people who are on planes a lot, and the flying experience, at least in this country, is not something that gets very much good press. Richard, will the flying experience be better for this new United-Continental combined group?

YANA RODGERS: I think it depends who has the upper hand when it it's all finished. Smisek knows what he's doing. And let's face it, Continental, one of the best airlines within the United States, flying experience. United has brought in its flatbed (ph) internationally, so it's made huge inroads into improving its service, its culture.

Bringing the two -- the biggest danger here, Christine, the biggest single danger is that when you merge two airlines, you bring the top down and you don't really bring the bottom up. And what Smisek admits, and he knows he's got to do, is ensure it has to be a rising tide lifting all boats. And that's going to be a challenge because the history of doing it is not necessarily on his side.

But frankly, and I'm not just saying this because, you know, I've met him once or twice, if there is one man who can do it, who has got the reputation, it is Jeff Smisek.

ROMANS: Hal is just chomping at the bit!

SPARKS: Yes, I've flown 126,000 miles this year, and the one thing that doesn't help an airline is a shake-up of any sort. So perhaps the United-Continental merger will create an airline that's very superior at some point in the future, but it won't be any time in the near future. And as a traveler myself, it makes me kind of want to avoid it for six to ten months.

ROMANS: With 126,000 miles, how many bag fees do you pay?

SPARKS: A lot, and it's ridiculous. And here's -- it's better in the States because it's per bag. In England, in the U.K., they charge you by the pound, which would be fair if they also weighed the passengers because I would get my bags on for free. But they don't.

(LAUGHTER)

QUEST: Hang on. Hang on. Hang on. Now, listen. The really...

SPARKS: Am I not right? Am I not right, Richard? Believe me...

QUEST: They do...

(CROSSTALK)

SPARKS: I weigh 150 pounds fully clothed soaking wet. If I -- if they weighed me and my bags and -- the pro wrestler in front of me from Scotland and his carry-on outweigh me by 30 kilos.

PIETRO POLLES, OWNER, SORRISO RISTORANTE: From 2007 to now, I have seen about 20 percent decrease in business.

BOLDUAN: Polles says the tough economy forced him to find creative ways to boost business and save his bottom line, including hiring his entire family.

PIETRO POLLES: I'm the chef and owner, and my wife runs the office and my son is my manager, the pizza chef, and my daughter now (INAUDIBLE) grad school, she also waits tables.

BOLDUAN: His son, Stefano, head pizza chef, says the economy has even changed customers' eating habits.

STEFANO POLLES, PIZZA CHEF: In the past, people would order an entree each, maybe a bottle of wine for two, and finish that off with a dessert. But nowadays, people, they tend to split main courses and then perhaps get a glass of wine or two.

BOLDUAN: So Stefano Polles, who attended school in Venice to learn the pizza-making trade, now shares his expertise, doing his part to bring in extra revenue with weekend pizza-making classes.

STEFANO POLLES: If you put too much yeast, the worst thing that's going to happen is it's going to blow up.

BOLDUAN: Students learn the art of authentic Italian pizza making and pick up tips on ingredients and technique.

STEFANO POLLES: They learn how to make the pizza that you find in Italy, from Rome all the way throughout the north. And I teach you the formula. You learn the formula, you learn the ingredients, and you learn the purpose of each of the ingredients, which I think a lot of pizza chefs don't know.

BOLDUAN: Polles now hopes to follow in his father's footsteps.

STEFANO POLLES: Yes, in terms of my dream, I definitely would like to, you know, continue in this business, to keep Sorriso up and running.

BOLDUAN: And while they're happy to teach the secrets of pizza making to boost business, not even a bad economy can convince this family to hand over all of their kitchen specialties. Those will remain family secrets for a long time to come.

Kate Bolduan, CNN, Washington.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

ROMANS: All right, we reported earlier in the show about the rise in prenups across the country. Another way to hold on to what's yours, hey, don't get married in the first place. According to recent data from the Census Bureau, in 2009, the number of young adults -- that's people between 25 and 34 -- who have never married surpassed the number of married young people in this country. Turns out when job security and budgeting are priorities, thoughts of a big white wedding seem to be on the back burner.

Hal, I guess it makes sense. Is marriage a casualty of the recession?

SPARKS: I'm sure that's a part of the factor. I think it's a long- term trend, though. I think if you look at -- and I personally, as a comedian, I have to take some responsibility for the world of comedy because if you look at from the '80s forward especially -- and even going further back, but specifically from then, marriage gets a really bad rap in comedy all the time. There's no good press about marriage. Marriage's stock is down. That's why prenups are up. Prenups are sort of the credit default swaps of marriage, ultimately.

(LAUGHTER)

SPARKS: You know what I mean? You're betting on the potential for failure. You're taking out insurance that it's not going to work. And the bit of positive to it, though, is that I'm going to venture to say that the number of people not getting married is actually going to positively affect the divorce statistics more than the marriage statistics.

We automatically assume that the people not getting married will stay -- are people lost from the married category. I actually think they might be lost from the divorce category because marriage is supposed to be special. Not everybody can do it. So the assumption that you can has driven this big rise and everybody -- when I get married -- well, maybe you're not and maybe the healthiest thing for you is to assume you're not and start looking at the person across from you as a relationship, not as a potential donor of some sort.

ROMANS: Hal's going to have a whole bunch of marriage jokes for you, and women earning more than men jokes, when he performs October 7th through 9th at Stand-Up...

(CROSSTALK)

ROMANS: Right?

SPARKS: This is true.

ROMANS: Anyway, so you're right, it has been the staple of the stand- up -- of the stand-up circuit, and we love to see you out on that. So thanks so much, Hal, for stopping by.

SPARKS: Absolutely.

ROMANS: And if you find yourself...

SPARKS: And buy "Smart Is the New Rich"!

ROMANS: Woo-hoo!

SPARKS: Buy "Smart Is the New Rich."

ROMANS: Woo-hoo! OK, you go see -- you can see Hal in Myrtle Beach and buy my book, and then -- Hal and I have now done our appropriate reciprocal plugs. Thanks, Hal. Hal Sparks...

SPARKS: I'm going to tweet about it like crazy.

(LAUGHTER)

ROMANS: All right. That wraps it up for us this week. We hope you stick with us. Twitter -- all week long, Ali and I are tweeting. Ali Velshi and Christine Romans also on FaceBook. And we do read every single one of your questions and comments. YOUR $$$$$ will be back next week, same time, same place, Saturday, 1:00 PM Eastern, Sunday at 3:00. You can also log on 24/7 to CNNMoney.com. Have a great weekend, everybody.